Could an In-House Health Clinic Save Your Business Money?

For years now, companies have been offering group exercise classes and flu shots to their employees, with the idea that an ounce of prevention is cheaper than a pound of cure. But as chronic conditions like obesity and diabetes continue to rise, some employers are offering a wider range of in-office health services — and reaping significant financial rewards as a result.

How Much Money Can You Save?

A recent study by the American College of Occupational and Environmental Medicine showed that employers who created in-house health services saw a return on investment of $1.50 to $3 for every dollar spent. Companies that adopt programs like these often see a decline in obesity rates and tobacco use, which in turn lowers absenteeism and other health care costs.

“Unhealthy people cost a lot more,” says Helen Darling, president of the National Business Group on Health.

According to Reuters, a survey from Towers Watson/NBGH shows that companies spend an average of $11,664 per employee for healthcare, which is an increase of 5.9 percent over last year’s costs. This is despite the fact that employees’ share of costs increased 9.3 percent to $2,764.

Bringing healthcare services in-house can offset these costs and help employees manage chronic conditions like diabetes, which they might otherwise tend to ignore.

What Conditions Can Clinics Treat?

In addition to diabetes, and those flu shots we mentioned earlier, in-house medical services can address infectious diseases like upper respiratory ailments, plus offer regular check-ups and monitoring for employees with chronic illnesses.

But perhaps the most successful function of these clinics is to provide prevention programs — weight loss, nutrition services, vaccinations, and smoking cessation programs.

Which Companies Are on Board?

Setting up a full-scale clinic isn’t cheap, so it’s no wonder that some of the early adopters are large companies like Intel Corp and American Express Co. But not every company needs to build a separate medical unit on-site to reap the rewards of in-house medical care. Even adding a few prevention programs can save money and raise employee morale.

But if you do decide to invest in a full-scale program, you’ll be in good company: by 2007, 100 of the top 1000 companies were offering on-site clinics of one sort or another, including Toyota, Credit Suisse, Sprint, and Pepsi.